Q&A with Misha Esipov, Co-Founder and CEO of Nova Credit Inc.

Michael Beckerman 5/8/17

Michael Beckerman

“A good business can also be built by doing good”…

Every once in awhile you connect with someone who really makes an impression on you. Misha Esipov is one of those rare people you meet who is doing good business while doing good for people. And I think his business model is just about one of the most unique I have seen in the real estate tech world. He and his Co-Founders are using technology to solve a really important global problem, namely getting credit for people who are migrating to the U.S. and who are challenged to get credit, to no fault of their own. And while doing so, his team is also helping them to rent an apartment. What an awesome goal!

I think something else that is interesting to think about is that while I have written about some of the challenges currently facing the current crop of CRE tech startups, I am also seeing an increase in the launch of some really interesting and innovative new sites. It’s an interesting sign of the times. Perhaps that’s the phase in the lifecycle of the real estate tech space we are entering.

I will let Misha explain his story and that of his startup, Nova Credit Inc., in his own words. My hope is that you will read this Q&A and pass it along to either owners/developers/institutions who own apartments or to anyone looking to rent an apartment.

Finally, one comment from Misha in the interview that really stood out for me and I hope it inspires others…”I cannot imagine building a business without a clear and honest mission.”

Love that!!!

Keep your eyes on Misha and his team and I hope you enjoy the Q and A…

What’s your background? Where did you grow up? Where did you go to school, etc…?

I was born in Russia and immigrated to the United States after the fall of the Soviet Union. As the son of Soviet academics, I grew-up hopping between various college towns in the Midwest and East Coast. I spent the most time in New Jersey / New York so consider that home although I’ve now sadly become a West Coast enthusiast. I studied Math and Finance at NYU and then completed an MBA from the Stanford Graduate School of Business.

What were you doing before founding Nova?

I started my career in Goldman Sachs’ investment banking division where I focused on the global natural resources sector. After a few years at Goldman, I left to join the private equity team at Apollo Global Management. I worked with incredible teams at both Goldman and Apollo which developed a great foundation for how to think about both value and credit.

After a few years at Apollo, I found myself looking to broaden my skillset and I was fortunate to be admitted into Stanford’s GSB.

What led you to found Nova and what was the original vision?

At GSB, I spent my two years going deep into the intersection of what I already knew relatively well (finance) and what I was studying to better understand (tech). I enrolled in a few of the university’s hallmark startup classes including Startup Garage and Steve Blank’s Lean Launchpad which established a great foundation in keeping things simple and focusing on need finding and customer discovery (rather than over-intellectualizing… as investors are often prone to do).

When Nicky, Loek (my Co-Founders) and I first got together, we spent a few months interviewing fellow students and friends about their experience with financial services and quickly spotted a trend. Nearly half of the graduate students at Stanford were international and nearly 100% of this half had a terrible experience with credit. This group of people had access to financial services in their home country, but were locked-out when they arrived to the US. We heard countless stories of terrible experiences of trying and failing to apply for credit cards, auto loans, student loans, renting an apartment, getting a cell-phone plan, signing up for basic utilities and more. Despite having a robust credit history back home, this group of people had to resort to terrible alternatives such as secured credit cards, payday loans or even putting a 6-12 month deposit down for renting an apartment.

The problem was clear from the beginning: recent immigrants can’t access credit. The solution and vision took longer to develop. We realized that financial access for immigrants is a systemic problem and that the only way to actually solve it is to build a piece of financial infrastructure that was once thought impossible. Nova has now built the first cross-border credit bureau which links together the discrete credit databases around the world and in effect, enables people to move their financial identity wherever they go. We call this the Nova Credit PassportTM.

How do you feel you are helping solve some of the massive challenges facing the immigrant community here in the U.S, and throughout the world?

Immigration is an incredibly daunting and vulnerable experience. It is a period of transition where you have to adapt to a new culture, language, and education system without the benefit of the social safety net that you left behind. It is precisely during this vulnerable time that access to capital is most important, but unfortunately the financial services industry shuts you out because they know nothing about you. It’s not because they are bad actors and don’t want to serve immigrants, but rather because they don’t have any information about how an immigrant has historically behaved as a borrower. Its an obvious problem, but one that is incredibly difficult to solve.

Nova is solving this problem by enabling people to move their financial identity wherever they go and in effect, land on their feet from day one.

Is this a personal mission of yours? A business opportunity? Both?

It has to be both. I cannot imagine building a business without a clear and honest mission.

Having personally lived through the challenges of immigration, I care about helping immigrants be treated as equals and not as second class citizens. I left a very steady career to solve a problem that runs deep and have found nothing more fulfilling. I know the same is true for my two amazing co-founders, Nicky and Loek.

How does the site actually work?

The technology is really quite simple. We enable lenders and landlords to securely access consumer credit information from around the world through a single platform. The entire system operates on the basis of consent where a consumer has to “opt-in” to access and share their information from abroad. This allows our customers to finally understand the borrowing behavior of both immigrants and Americans returning from abroad.

Who are your investors?

We’re backed by an incredible group of investors including First Round Capital, Index Ventures, Y Combinator, Nyca, Core Innovation and a variety of thought-leaders in both traditional financial services and fintech.

How do you market the site? Who are your target audiences and how does your site help them?

We started Nova to serve traditional financial services and marketed the business through a few industry conferences. Over the last few quarters, we’ve received significant inbound from both large property managers and their international tenants and have now formally launched our property management vertical. We’re looking to continue to invest time and resources to power a fair and efficient tenant screening process for immigrants. Our ideal audience includes property managers and platforms that exist in immigrant-dense urban environments along with East and West coasts.

What’s next for the company?

We’ve got a tremendous amount of work to do to be able to continue to add vendor and customer integrations around the world. That is our entire focus today and we’re moving as quickly as we can.

Misha leads Nova’s strategy and market expansion. Misha emigrated with his family to the US from Russia in the nineties, and has a background in finance (Goldman Sachs and Apollo). Misha holds a BA from NYU and an MBA from Stanford.

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